The NBA and the Financial Crisis
|10.15.08 at 12:08 pm ET|
Later today, Massachusetts Gov. Deval Patrick is going to unveil a plan that will cut 1,000 state jobs and $700 million from the budget. Earlier this week, the NBA announced that they are laying off 80 people in anticipation of the fiscal crisis.
These are tough times, obviously, but the real story to keep an eye on is the groundbreaking on the New Jersey Nets new building in Brooklyn, which could be set back at least six months, “after an appellate court declined to dismiss a lawsuit filed by foes of the plan.”
The Nets move was planned to coincide with the 2010 season, which is ground zero for the biggest NBA free agency shopping period ever. The big prize, of course, is LeBron James, and the mere thought of Bron-Bron in New York has pushed the Knicks and Nets into one cost-cutting move after another in an attempt to clear cap space. Both teams have essentially abdicated the next two seasons.
How does the looming financial mess affect the Celtics beyond having 40 percent of their division sell off its assets? It doesn’t. Yet.
Long before the world’s economic markets went into freefall, the Celtics opened a three-year window of competitiveness. It began last season with the Kevin Garnett and Ray Allen trades, and the first year ended rather nicely, as we all know.
The Celtics went into luxury tax territory to compete, but Allen’s contract comes off the books after the 2010 (as does Eddie House and Brian Scalabrine’s deals). The only players under contract in 2010 will be Garnett, Paul Pierce, and Kendrick Perkins.
The Celtics will also control the rights of Rajon Rondo (count on Rondo being a major part of the team’s future) and JR Giddens. They will also have made decisions on their bevy of second-round picks by then. All of which means that the Celtics will be able to take a step back in 2010 and assess where they are and where they are going.
No, the Celtics aren’t likely to be a player for LeBron, but they have some flexibility while still being among the favorites to win an NBA championship, which is a pretty enviable position.
What we don’t know is how the crisis will affect the fans. Will they still shell out the dough to watch the C’s play the Bucks in January? Will they buy their KG jerseys and over-sized foam hands? The problem with the economy is that we still don’t know where the bottom is. Sports were thought to be recession-proof. I suspect we’ll be challenging that notion in the next few years.
UPDATE: Quick follow-up on this post. It seems Bruce Ratner’s Atlantic Yards project, which would house the Nets, is in a lot more trouble than we originally thought. It’s hard to imagine LeBron playing for a Nets team that is located in North Jersey.